Can Trade With Cuba Be Far Behind?

Source: U.S. Wheat Associates | Apr 27, 2009

Action taken by President Barack Obama last week could mean normalized trade relations with Cuba could resume within a few years. The president lifted all restrictions on family visits and remittances for Cuban-Americans and directed the U.S. government to take steps that will facilitate greater contact between separated family members in the U.S. and Cuba.

It would also increase the flow of information and humanitarian resources directly to the Cuban people. The president also called on the Cuban government to reduce the charges it levies on cash remittances sent to the island.

According to Rebecca Bratter, director of policy, U.S. Wheat Associates[2] (USW), the actions still impact the measures that restrict the free flow of trade between the U.S. and Cuba as well as additional sales of U.S. wheat. However, USW remains optimistic that the effort will lead to full normalization in the near future, including a full repeal of the travel ban for all U.S. and Cuban citizens and easing of cash before shipment payment restrictions.

The Obama administration could take further steps to ease the U.S. policy towards Cuba, but the president acknowledges that policy shift takes time and would require cooperation from the Cuban government on issues such as political prisoners and a move toward democracy.

“While the new regulations easing travel and remittances for Cuban Americans are a good first step, lifting the embargo is a long-term prospect,” says Bratter. “In a positive sign toward progress and a reversal of previous rhetoric, Cuban President Raul Castro said he is willing to discuss all topics with the Obama administration.” (However, former president Fidel Castro discounted some of the steps Cuba may take.)

Cubans consume almost 24 million bushels of wheat/year, and the island country has no domestic wheat production. The U.S. already exports some 10 million bushels of wheat to Cuba, but the European Union is Cuba’s largest supplier. Given Cuba’s close proximity to the U.S., it stands to reason that American farmers could capitalize on the opportunity that normalized trade relations would create.

USW and National Association of Wheat Growers[3] will continue long-standing efforts to promote full normalization of U.S.-Cuba trade relations resulting in enhanced agricultural trade and new exports of U.S. origin wheat.